ECB Cautious on Rate Cuts as Inflation Risks Persist, Lagarde Stresses Sustained Interest Rates for 2% Target, Schnabel Highlights Monetary Policy Efficacy, Economists' Inflation Forecasts Differ, Modest Euro Zone Economic Growth Forecast

The European Central Bank (ECB) is cautious about discussing rate cuts due to ongoing inflation risks. ECB Vice President and President, Isabel Schnabel, emphasized that monetary policy is working to bring down inflation. However, the ECB forecasts for inflation are higher than some economists' predictions. President Lagarde and other ECB officials have expressed concerns about inflation, with Lagarde suggesting that interest rates need to be sustained at current levels for a significant period to achieve a 2% inflation target. The ECB is also expecting a temporary rebound in inflation in the coming months, while the Euro zone's economic growth is forecasted to be modest in the next few years.